What If Stores Only Sold Private Label?

April 29, 2015

You walk into a Kroger and everything looks different. There are brands you’re familiar with, but not the old-school ones they usually carry. All the names seem decent, but they’re not the goods you grew up with. You check the labels and the quality actually seems better, so you’re pretty sure you should go for it.

Then you walk into Walmart and Target and it’s a similar scenario; labels that look reputable but have names like “Great Value” or “Archer Farms”. Hmmmm. What gives?

Who are these guys? Some you’ve tried before, but there are plenty of others that are new, good looking, good quality brands. They come in all shapes and sizes, from cola to detergent. It’s a brand new landscape. Gone are Coke, Pepsi, Mars, Tide, Wrigley, Kellogg’s…the old standbys. Do you care? Do you think you care? Should you care?

In the world of commodity selling and brutal price competition from online giants like Amazon and Alibaba (some in partnership with the manufacturing brands), this is the future of retail my friends: Private Label World. How does it look to you? How does it price to you? What do you think? What if? Are you in?

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Comments

This will make the retailer’s brand a major differentiator. As there is def. a halo effect on those private label products. Though sometimes the private label product outshines the retailers brand – in the case of CostCo and the Kirkland brand.

Another interesting permutation (though not strictly a private brand) is the case of Persil (a high end laundry detergent from Germany’s Henkel AG) that has an exclusive partnership with Walmart in the US and is being slotted to directly compete with Tide. The raw detergent isn’t being commodified but the premium brand and premium product seems to be the commodity. Will be interesting to see how this approach plays out.http://www.wsj.com/articles/wal-mart-to-sell-premium-priced-german-laundry-soap-persil-1426467859